Monday, 27 October 2014

How to knobble Pharmac

The fate of Pharmac under the TPPA is of enormous public concern. Pharmac gives kiwis a degree of market power over foreign drug companies. As the single public-sector buyer of drugs, it can make good use of legally produced generic drugs made from expired IP.

We know that big-pharma hates it, and one of the USA's goals for the TPPA is to gut it.

But how could our government get away with doing that? How would they try to sell it? I got a clue on twitter last night after I corrected Matthew Hooton's claim that "everyone" would benefit from the TPPA. Here is are the lines...

So, hell no, we love Pharmac. There is no suggestion of killing it. We just want to enhance it a bit so that "everyone" is better off.

Think for a tick about alternatives to Pharmac. One is that DHBs etc buy their own drugs, so there are multiple buyers. That could still work out OK because each of these buyers would still have a bit of market power, and it'd give NZ a solid response to any claim that Pharmac was unfair under world trade rules (if we felt the need to respond). But this would be perhaps even worse for big-Pharma - all those individual buyers to schmooze.

Far better, for big-Pharma, to have one "regulator" and make it utterly captured. So keep Pharmac but remove its ability to make it's own choices. Brilliant.

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